kcaee wrote:
Gbaji, corporations are evil and are becoming the puppetmasters of politics. Be it democrat or republican puppets, they are becoming the masters. Now, dems tend to go for workers rights and things like that so I lean in that direction.
Ok. First you lead off with an assumption, which you cannot support. Secondly, you are certainly entitled to your opinion about which party is "better" for workers, but I happen to disagree with you. Dems do *seem* to be more supportive of workers rights issues, but in many cases, this is not a good thing in the long run. Promoting policies to increase wages seems great at first, but businesses will *have* to react to that. Raising the wages of workers does not decrease other costs for running a business. That difference has to be made up somewhere, and that's usually going to be in the form of layoffs for the very workers you tried to help (or inflation of consumer good prices, which is fine for those who were affected by the wage increases, but makes everyone else poorer).
It's not as simple as just giving people higher salaries.
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Now, are you ignorant? Of course not. I'm not gonna go through a quote for quote deal with you, but if you think the only way a corporation can make money from money is by creating jobs or research or product, you are deluded in the extreme.
Ok. Then name one. I'm betting you can't.
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Also, you tend to forget that there are case after case examples of companies achieving record profits and downsizing at the same time. Profits and extra money do not equal job creation by any stretch of the imagination.
Sure. But that doesn't contradict anything I said. Over the long term profits are tied to expansion of the business, and expansion includes hiring of labor. But that assumes that the "price" for the labor is accurate to the value being generated by that labor. If my business finds itself in a situation where my labor costs are producing less then they are worth, then I can certainly increase my profits by cutting my labor.
But you're arguing on specific case against the overall trend. So for one year, I can measure a record increase in profits by trimming labor, but if I want to increase profits overall, I have to start expansind, and that meand hiring more labor.
Look at it another way. If I can produce and sell the same number of widgets while employing 800 workers that I can produce employing 1000 workers, then trimming my labor costs by 200 workers will increase my profits, right? But that case *only* exists if I'm already employing more laborers then I actually need to run my business. I'm overpaying. I can choose to do that but then I'm going to steadily lose money. My competition will make more proit per widget then I do, and I'll eventually be run out of business (and all my workers will become unemployed instead of just 200).
Now in an ideal world, I'd like to expand my operation to give that 200 laborers something to do that generates as much profit per worker that the first 800 do. However, remember what I said. Profits allow for expansion, which drives a need for more labor. I must have that profits *before* I can start that cycle. It doesn't work the other way around. The "correct" solution is to lay off the extra 200 workers, thus maximizing my profit per widget. I then use those profits a few years down the line to expand my widget making plant, then I can hire those 200 laborers. Thyus, not only am I now hiring the full 1000 workers, but I'm making the same profits per worker and profit per widget produced as I was whe I had 800 workers. Even better, I'm now making 25% more widgets, so my *total* profits are 25% higher, meaning that I can afford to expand my business again that much faster (and hire even more workers down the line).
Doing it the Democrat way is certainly better for those 200 workders in the short term. But it screws them in the long term. Jobs get more scarce. Businesses bottom lines get thinner and they have to seek alternatives. The typical Dem response to this is to "protect" those jobs, but this just drives companies to seek labor elsewhere (like outsourcing to other countries with cheaper labor and less stringent labor laws).
IMO, the Dem approach is extremely shortsighted and doesn't really help labor in the long term.
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Why do you think pissing on economics was called voodoo economics by the majority of the economic community.
If you're refering to "trickle down economics", then you are vastly oversimplifying the issue. Certainly a broad economic approach that only recognizes supply side ideologies doesn't work. But neither does one looking only at demand side. Arguing that trickle down doesn't work because it doesn't work in all cases and all situations 100% of the time is amazingly misleading. The basic concept, that money retained by businesses in the form of profits "trickles down" to employees is completely sound. The flaw to trickle down economics does not lie there. No one denies that this process does in fact occur (except for people who just spout off a "trickle down doesn't work" rhetoric without actually knowing anything aabout it). The flaw to trickle down theory is that it makes no allowance for the unemployed. Since only those employed gain benefits from it, it will fail to ensure that profits alone will ensure economic security. But that's a completely different issue and topic.
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Rich people save more then spend, you are aware of this, right? The biggest stimulus of an economy is spending, not saving. So, rich get tax cuts, they have more money to engorge their already engorged economic status.
First off, you've got it slightly wrong. It's not that rich people "save" more then they spend. It's that rich people spend less then they earn. And just to clarify it even more, people who spend less then they earn will end up being rich (it is a mathmatical certinty). People *become* rich by having good spending habits, not the other way around.
Secondly, "saving" is a misnomer. Wealthy people don't just toss their money into a savings account, under their matresses, or in a big vault like Richy Rich. They invest their money. Those investments go towards those expansions of business I talked about earlier. They provide the money that you use when you take out a car or home loan. They provide the money and capital that new businesses use to start up. And yes, they get a return on that as well.
Thirdly, spending is not the biggest stimulous of an econoy. It is *a* stimulous, and at any given point it may be the biggest, but it's ultimately just one component of an economy. You can't spend money unless there's something to spend it on, right? Thus, for every dollar that every person spends in the economy, an equal amount of effort must be "spent" providing goods and services. That's all coming from those "evil" corporations. Cut off their profits and the range and quantity of goods availavle decreases over time.
It's far more correct to say that consumer spending and the supply of goods and services should be as much in balance as possible. If there's more money available to spend on goods/services, then the cost of those good/services goes down, and the profits go down, and the value of labor goes down, and people have to lose jobs. If there's less money available to spend on goods/services, then the costs of those good/services go up, causing inflation potentially. The ideal is to balance them as close as possible. This is why blanket statements like "trickle down doesn't work" or "demand side spending is flawed" are themselves wrong. Both represent two sides of the equations. Both are needed at different times to keep the forces of supply and demand in balance.
Again. This is an incredibly complex topic. You do it a grave disservice by just declaring corporations to be "evil" (especially for the reasons you stated). Corporations (and businesses in general) are copletely neutral. They have a simple and direct goal: To earn profits for their ownders/investors. Whether those goals invovle good or bad is mostly determined by how we create our business and labor laws. If we create them with an understanding of the goals of business and how market forces will cause business to react to those laws, then we can construct sane laws that protect workers and alow businesses to profit. If we construct them specifically to "help workers" or "punish those evil big businesses", then we are likely going to miss the obvious and inevitable consequences of those laws, and end up hurting ourselves more down the line.